• 2 hours Tech Billionaire Takes Aim At Google
  • 4 hours Chinese Police Bust Largest Ever Illicit Crypto Mining Operation
  • 7 hours Expect A Pullback Before Gold's Next Major Rally
  • 9 hours Why Interest On Gold Matters
  • 1 day Ten Extravagant Food Items For The Wealthy Only
  • 1 day Why Saudi Arabia Won't Give Up On The Aramco IPO
  • 2 days $32 Million Crypto Heist Halts Tokyo Exchange
  • 2 days Is A Gold Selloff Looming?
  • 3 days Central Banks Are Stashing Gold And Dumping Treasuries
  • 3 days Three Cannabis Trends Flying Under Investors’ Radars
  • 4 days $1.3 Billion In Cocaine Found On JPMorgan Vessel
  • 4 days Amazon Teams Up With Lady Gaga To Win Over Generation Z
  • 4 days Dollar Falls As Powell Teases Rate Cuts
  • 4 days Will The World's First Trillion Dollar Company Ever Bounce Back?
  • 5 days Many Americans Will Never Stop Working
  • 5 days Mozilla vs DarkMatter: The Cyber Espionage End Game
  • 5 days Chile Cracks Down On Environmental Infractions
  • 5 days Warning Signs Emerge For Boeing
  • 6 days First Amendment Stands Strong In Trump vs. Twitter Showdown
  • 6 days Musk Bullish On Tesla Despite Executive Exodus
The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

  1. Home
  2. Markets
  3. Other

Trump Stock Market

Equities sold off sharply as the election results started to come in, but by the end of the week, the market had settled generally higher.  As with Gold, equities have a Cycle trending in a certain direction, and we should continue to follow the dominant trend until the action directs otherwise.

The Dow Jones made a new high this week, but the broader market has yet to follow. And since weekly Cycle timing continues to favor more downside before an Investor Cycle Low (ICL), the resistance line on the below chart should continue to hold. At this point, there is not enough evidence to warrant speculating about a new Investor Cycle (IC) and IC rally.

For now, a reversal lower from here as part of a Left Translated Cycle is the highest probability scenario for equities. But the highest probability scenario does not always come to pass. If, instead of rolling over, the market moves to a new all-time high, we will need to quickly change our perspective.

It is not always easy for traders to shift quickly - too often our egos get tied up in a viewpoint - but the markets do not care. They will go where they go. At best, traders are right on a market's direction only 60% of the time; it's how a trader formulates and executes his strategy that matters most. Traders must embrace planning and execution, and must remain adaptive. To do otherwise risks getting caught in a position that is fighting a trend.

S&P500 Daily Chart

The size of the post-election, Trump Stock Market bounce has pushed the weekly Cycle indicators high enough to threaten a new Investor Cycle.  The possibility is very real, but it's not a slam dunk. If we are in a new IC, an ICL would have been printed at 18 weeks, slightly short of the normal timing band for it. And from a technical standpoint, the ICL would have been very mild.

The S&P has moved back above the 10-week moving average - generally confirmation of a new IC - but it has not yet decisively smashed through this resistance zone and moved to a new all-time high. If it can move quickly to a new high, a major rally could well be brewing. Until then however, I will continue to expect a more traditional ICL selloff in the coming 6 to 8 weeks.

S&P500 Weekly Chart

 


The Financial Tap – Premium

The Financial Tap publishes two member reports per week, a weekly premium report and a midweek market update report. The reports cover the movements and trading opportunities of the Gold, S&P, Oil, $USD, US Bond’s, and Natural Gas Cycles. Along with these reports, members enjoy access to two different portfolios and trade alerts. Both portfolios trade on varying time-frames (from days, weeks, to months), there is a portfolio to suit all member preferences.

NOTE: The Financial Tap offers you a Full 14 day, no risk, money back Trial. It’s just $99 thereafter for a full 3 months of membership, a fraction of what one stopped out trade is likely to cost you. Consider joining The Financial Tap and receive two reports per week and the education you need to become a better trader or investor See >> SIGN UP PAGE!

 

Back to homepage

Leave a comment

Leave a comment